Dealers with a consumer credit licence should have been notified by the Financial Conduct Authority (FCA) and Office of Fair Trading (OFT) of changes to consumer credit regulation and have until the end of August to check their details are correct.
On July 15 the FCA released further information including a call to action for dealers to register for ‘interim permission’ from September, if they wish to continue the activities currently licensed for under the OFT after April 1, 2014.
This will be followed by a full submission, with dealers being notified at a later date if their application has been successful.
Dealers who are not currently FCA regulated either directly or as an appointed representative will have to pass the new FCA’s fitness and propriety requirement and meet their financial resources criteria.
Failure to satisfy these levels will mean that dealers may not be granted FCA authorisation even if they have previously held an OFT consumer credit license.
75% of dealers do not have the correct categories on their consumer credit licence
The FCA has advised dealers that they have until the end of August to check their current OFT Consumer Credit Licence details to ensure they are correct and include Category D (provision of debt-adjusting) and Category E (provision of debt-counselling), if these categories are not included they need to be added.
A review of dealers’ consumer credit licences by Automotive Compliance, authorised and regulated by the FCA to act as a principal firm for a network of motor dealer appointed representatives, has identified that 75% of dealers do not have the correct categories on their Consumer Credit Licence.
Paul Guy, Automotive Compliance managing director, said: “Dealers should be checking their CCL’s now to save time before they register with the FCA from September for their interim permissions.
“In many cases we have found that the debit counselling and debt adjusting categories are not present on licences.
“In some cases even dealers’ basic categories have not been applied correctly, which may not have been a problem in the past.
“However in applying to the new regulator for ‘interim permission’, all categories will be checked and errors could result in suspension of trading until discrepancies to their licence are rectified.”
Automotive Compliance is offering free advice to all dealers with the guide to the CCL changes on its website.
The FCA Timelines for Consumer Credit change
July 15 2013
The FCA and OFT write to all licensed Consumer Credit firms to tell them about the changes
July - August 2013
Firms check their OFT details
September 2, 2013 until March 31, 2014
Dealers can register for ‘interim permission’. The FCA will write to all consumer credit firms to let them know if they can register and how to do it
End of September 2013
The FCA publishes for consultation more detailed proposals on new regime